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FCC Chairman Not Excited About Verizon’s Plans to Throttle Unlimited Data Users

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Last week, we exclusively reported that Verizon planned to begin throttling the top 5% of unlimited data users with 4G LTE phones come October 1, a move which Verizon has since confirmed. The throttling is a part of Big Red’s “Network Optimization” policy, which up until now has only affected 3G customers with unlimited data. As you can imagine, this news didn’t exactly excite those with unlimited data plans who have been long-time Verizon customers. According to a letter sent to Verizon Wireless CEO Dan Mead, FCC chairman Tom Wheeler isn’t excited either. 

In the letter, chairman Wheeler doesn’t hold back, specifically noting that he is “troubled” by the announcement. He also points out that Verizon’s “Network Optimization” policy shouldn’t be used as a “loophole designed to enhance your revenue streams.” Wheeler calls it “disturbing” that Verizon would base its network management “on distinctions among its customers’ data plans, rather than on network architecture or technology.”

He then moved on to Verizon’s obligations under the 700MHz C Block rules that Big Red adopted when it purchased spectrum for its LTE network and how this new policy could be in violation. These rules include not denying, limiting, or restricting the ability of end users to download and utilize applications of their choosing. Wheeler makes a good point in suggesting that in no way do these rules specifically state that unlimited data users could be used as an exception.

The letter ends with Wheeler asking for responses to three specific questions. The first asks for an answer as to why Verizon is treating customers differently depending on their plan type. The second and third ask about the rationale behind Verizon’s brand new LTE network needing speed reductions and if they can justify this new policy consistent with those previously mentioned in the C Block rules.

It’s a juicy letter, though we aren’t sure if it will lead to anything just yet.

Here is the full letter:

Dear Mr. Mead:

I am deeply troubled by your July 25, 2014 announcement that Verizon Wireless intends to slow down some customers’ data speeds on your 4G LTE network starting in October 2014. Your website explained that this was an extension of your “Network Optimization” policy, which, according to your website, applies only to customers with unlimited data plans. Specifically, Verizon Wireless “manage Es] data connection speeds for a small subset of customers – the top 5% of data users on unlimited data plans” in places and at times when the network is experiencing high demand. Verizon Wireless describes its “Network Optimization” as “network management.”

“Reasonable network management” concerns the technical management of your network; it is not a loophole designed to enhance your revenue streams. It is disturbing to me that Verizon Wireless would base its “network management” on distinctions among its customers’ data plans, rather than on network architecture or technology. The Commission has defined a network management practice to be reasonable “if it is appropriate and tailored to achieving a legitimate network management purpose, taking into account the particular network architecture and technology of the broadband Internet access service.” Such legitimate network management purposes could include: ensuring network security and integrity, including by addressing traffic that is harmful to the network; addressing traffic that is unwanted by end users (including by premise operators), such as by providing services or capabilities consistent with an end user’s choices regarding parental controls or security capabilities; and reducing or mitigating the effects of congestion on the network. I know of no past Commission statement that would treat as “reasonable network management” a decision to slow traffic to a user who has paid, after all, for “unlimited” service.

Accordingly, please provide me with responses to the following questions:

  1. What is your rationale for treating customers differently based on the type of data plan to which they subscribe, rather than network architecture or technological factors? In particular, please explain your statement that, “If you’re on an unlimited data plan and are concerned that you are in the top 5% of data users, you can switch to a usage-based data plan as customers on usage-based plans are not impacted.”
  2. Why is Verizon Wireless extending speed reductions from its 3G network to its much more efficient 4G LTE network?
  3. How does Verizon Wireless justify this policy consistent with its continuing obligations under the 700 MHz C Block open platform rules, under which Verizon Wireless may not deny, limit, or restrict the ability of end users to download and utilize applications of their choosing on the C Block networks; how can this conduct be justified under the Commission’s 2010 Open Internet rules, including the transparency rule that remains in effect?

I look forward to your prompt response.

Sincerely, Tom Wheeler

Via:  GigaOm [PDF]
  • Vincenzo Roberto

    These bureaucratic fools should stay out of private matters and let the customers decide. Most of the “problems” are already due to a lack of competition which is cause by the regulations already in place. The last thing we need is the government further mucking things up. Sovietizing our internet access is not a good idea.

  • Willie D

    “These rules include not denying, limiting, or restricting the ability of end users to download and utilize applications of their choosing. Wheeler makes a good point in suggesting that in no way do these rules specifically state that unlimited data users could be used as an exception.” – No, but the issue here now lies in, unlimited data, being throttled, or limited in this case, is specifically mentioned by Verizon to only happen to people out of contract, using high bandwidth intense applications like streaming music, video, gaming. This in itself violates the rules, as it limits and restricts the ability of the end user to utilize the application. Unfortunately for Verizon, they agreed to the terms and conditions, they are free to sell off that 700Mhz spectrum that T-Mobile would be happy to purchase, and move to AWS only and go about locking down their XLTE network all they want.

  • Razma

    if they are gonna bother with the whole throttling thing, why not just make it after 15 or 20GB, it’s such crap to say that 4.7GB is high usage.

  • Alan

    This is just another in a myriad of less than customer friendly moves from Verizon. Remember when we could purchase a new phone every 21 months? Remember when the call center employees actually had knowledge of new products more than one day before the product’s launch? Remember when we weren’t charged for using our phones during a holiday? Remember when the direct store didn’t need to decieve customers to make a sale. Remember when unlimited data plans were touted by Verizon and available to all of its’ smart phone users at a single price.
    There are so many things wrong with this new trottling or “Optimization” idea. Aren’t smart phones designed to use data? Aren’t we told by, Verizon and others, of the benefits of downloading music and videos on our phones?
    Why 4.7 gigs? If this is the level that Verizon has deemed to be the top 5% of data users, Verizon should probably review the methodology it used to arrive at that number.
    According to several Verizon tech service agents that I have spoken with and many knowledeable technology experts , the real problem is that the LTE towers in the United States are not adquate enough to handle higher loads during peak traffic periods. Therefore we are asked, first with the introduction of its’ tiered data plans, and now through trottling to help Verizon fix its problems. Perhaps, Verizon should have resolved the issues with its low tech towers before it promotted the advantages of using your smartphone as a computer.
    To those who seem to delight in the punishment of higher data users, wait until Verizon begins charging more for phones for your two year upgrades or decides to charge more for each level of its’ tiered data plans or reduces corporate discounts or lowers its’ trottling level. Thinks things like this won’t happen? Wait.

    • mike_s123

      “Remember when we could purchase a new phone every 21 months? ”

      You used to be able to get a new phone every 9 months, by paying an extra $50-100 for a phone with a 1 year contract.

  • jgb

    Verizon has been trying to move those of us with the unlimited data into a usage-based plan since day one. Unless the FCC curbs this, they will eventually succeed.

  • Johnny_Fever

    Two things – #1 – this is only for looks; Tom Wheeler – FCC Chairman made millions of dollars working as a lobbyist for the cellphone and cable TV companies for years before this very questionable appointment; I doubt he’ll bite the hand that fed him for years. He will do NOTHING; mark my words.
    #2- The FCC is going to ‘steal’ the over the air UHF TV channels (again, like block C) and SELL them to the cellphone companies – this is bunk, as we lose free over the air signals while the bloated cell companies like Verizon get even MORE frequencies to SELL over-priced and throttled-down bandwidth.
    My most hated list: Oil Companies that export USA oil and import MidEastern oil and charge us more; #2: Cellphone Companies; #3 The FCC (except Mr. Pai).

  • s0nic69

    Seriously people, calm down! Stop getting mad at people who use more than 5gb a month. I pay for tethering on my phone and unlimited data, I have the right to do this. I hit between 5-15gb a month, and if anyone has a problem with that, too bad. I pay my bill monthly for services that I will use as I want. Idk where all this hate is coming from, when Verizon has always been the enemy, just a bunch of trolls pointing fingers for no reason.

    • Droid 1967

      geez man you probably watch more than 3 hours of tv from that paid service you have. I cant believe that just because they dont limit the amount of time you can watch or the channels you can watch that you paid for doesn’t mean you should!.

    • d-rock

      It’s not anger because they use more. It’s frustration to see such entitlement by these people. Verizon sells a service. They have chosen not to sell this service any longer. Instead of simply moving people over to the new service (with the option service termination), they let people use it for years. Sometimes grandfathers die and the unlimited grandfather is very old and tired and will be dead in a couple months.

      End entitlement and move on with your lives. It’s your dollar. You choose if you buy their service. It’s their service and they choose if they sell it to you. You can’t be mad at Verizon because they are a company making money. Verizon exists for one reason, to make money. Yes they are greedy. But everyone here whining is just as greedy or they wouldn’t be whining about losing their precious.

      You want more data usage
      Verizon wants more money

      It SUCKS…i know. It sucked losing unlimited a long time ago when I gave it up, but you’re not entitled to it. You just were allowed to use it longer.

      • s0nic69

        d-rock , it is anger, I have read some really crazy comments on any article that talks about unlimited data dying. Maybe because your not being called a this or that…that you don’t feel it.

        Ill stand here and admit that I use it at work to get around our firewall, at home when wifi wont reach the back yard, in the car for Pandora…but I pay for this service (I pay for 4g and tethering from Verizon). Yes it is a grandfathered service, the service belongs to Verizon and they can do whatever they want. The grandfathered ability belongs to me and ill end it when I want also, it is a 2 way street.
        What kind of fool would I be to just say…I feel guilty for being grandfathered in, I am going to pay more out of my pocket so that I can be like everyone else.

        • d-rock

          You and everyone(even the cheaters) are all within your right to keep it as long as you can. But many act like they are being cheated by Verizon because they are doing this. That displays entitlement. If they don’t like it, leave, but Verizon nor anyone else owes them anything.

  • Tim Shanks

    seems like Wheeler, being a former lobbyist would have been in contact with Verizon before this all went down and this had all been worked out before, and then sent Verizons CEO this letter to address the 3 top concerns that everyone on the internet has been griping about since the days of rooting your phone for unlimited tethering to save face with the public to make it appear the FCC cares… all the while verizon, comcast, time warner all funnel more money his way or his political parties pocket. god i sound like a conspiracy theorist, but i just finished watching house of cards… so excuse my pointless, baseless, unjustified rant.

    • Droid 1967

      wouldn’t it be nice if that was just a conspiracy thinking , unfortunately it is truly accurate :(

  • chris_johns

    i wish verizon did this a long time ago instead of getting rid of unlimited data plans theyd have a lot more 2year contract upgrade phone purchases…i dont give a f about the cheap jews running their house internet from their cell phones ruining unlimited data for everyone

  • Marc

    I am surprised Wheeler even cares… In the past he seemed to be the telco’s b#$&@!
    I could imagine that he is afraid of loosing his unlimited data with Verizon though!

  • Frawlz

    I’m under contract and I have unlimited data… where does that leave me?

    • d-rock

      You should be fine until your contract ends.

      • Frawlz

        That’s what I thought… thank you!

  • d-rock

    I think it’s so funny to see all these people bragging endlessly about having unlimited data and cheating the man and using 100GB/month, using it as home internet and tethering and torrenting, etc, finally see it coming to an end and are just crying like 2 year old babies having the cookie jar taken away from them.

    I’m sorry but I have ZERO sympathy as do most of us who aren’t you.

    You just can’t count yourself lucky to have had it as long as you have. You have to feel and act entitled about it.

    • vOc627

      I have unlimited data; it’s pretty awesome. :)

      • d-rock

        At least you’re grateful and not whining!

    • SkyCode

      how are we cheating the man its called unlimited for a reason.

      • fritzo2162

        I’m with ya! For lunch, I’m also hitting the Unlimited Chinese buffet down the street. I plan to keep packing food away until next Monday.

      • d-rock

        If you ONLY used it on your phone..and did not tether in any way, you’re not cheating. But most of the whiners are not using it this way. They are cheating by tethering and it was this abuse that brought it all down anyways.

        • SkyCode

          Why would I need to tether when I have a 5.5 inch screen?

          • d-rock

            I have no qualms with someone who’s not violating the TOS. They can complain and probably have more right than others, but the bottom line is that if you aren’t under contract, they can do what they want and you’re still lucky they didn’t take it away years ago. You should still count yourself fortunate and move on in life.

          • Droid 1967

            i don’t understand this why we are fortunate. If you were on Verizon at a point where they had unlimited and you dont now than that is your fault. Anyone who was on Verizon prior to them discontinuing it can still have unlimited if they dont that is because of their doing.

          • d-rock

            Because they could have just switched you over a long time ago to a different plan…yes you might leave, but where will you go? AT&T? They are just as bad with data. Tmobile? Good luck with coverage.

            So yes you’re lucky, not privileged like you come across.

          • Droid 1967

            well kinda. when i lived in colorado i actually used my tmobile phone more than the verizon cause verizon service sucked. Luckily i kept both as i kept verizon simply because of the unlimited. and now that i moved to here its actaully the only place i have been that has total crap 2g on tmobile. If it wasnt for tmobile back than My rom would of died long before i burned out simply because i never could of uploaded it. If tmobile ever upgrades the network here I would switch back in a heart beat if verizon dumped unlimited. Not sure what i will do if verizon dumps unlimited and tmobile hasnt upgraded by than But i would most likely switch to a gsm carrier.

        • Jason Brown

          tether is a feature thats provided on phones. might as well get rid of the option of tethering then…

          • d-rock

            And the core tether feature on many phones is blocked unless you pay for it. Besides the fact that it’s in the terms of service saying it’s not allowed to be used.

    • Chippah

      D-Rock Comment?

    • chris_johns

      THANK YOU…someone who gets it

  • shelooga

    ive got an idea: how about you jerks start using more data so IM not in the top 5%?? selfish aholes…
    oh and to d-rock: youre an idiot. move along sir

    • chris_johns

      you’re an idiot

      • shelooga

        aw

  • Chippah

    This FCC guy must be on a month to month unlimited data plan and is on our side.
    ha

  • Paul

    Sold my unlimited plan on eBay for $625 last week and joined T-Mobile. Best feeling ever.

    • chris_johns

      lol good for you

    • Destroythanet

      Nice. Yeah, I’m going to sell one of my Unlimited Data Lines this week. If anyone’s interested, let me know.

  • SamBoy

    So tired data plans isn’t limiting customers?

    • yankeesusa

      Nope, this throttling is only for 3g customers or while on a 3g tower and now for lte customers on the unlimited plans. All other plans don’t get throttled.

    • socarwolverine

      Well, since you agreed to it, no, you self limited.

      • SamBoy

        I have a unlimited plan and most people had no other choice

  • BoFiS

    Would be amazing if the FCC could stop this customer abuse by carriers

  • Luxferro

    Wait? A cell phone provide using false advertising about their unlimited plan…. no way. FCC just pulled it’s head out of the sand for a few minutes.

    ***They should not be able to use the word unlimited with an asterisk***

    • yankeesusa

      Technically unlimited means unlimited data, not unlimited data at the highest speed available. Tmobile has a plan where they slow you down after 5 gigabytes but they don’t limit the data or charge you extra when you go over, they also have the unlimited that gives you the fastest speed all the time no matter how much data you use. For now I don’t think verizon is limiting the data that unlimited plan users use.

      • Luxferro

        I get what you’re saying. But the marketing behind it is to purposely mislead their customers.

  • morgan boyle

    If i wasnt connected to my ChromeCast so much i wouldnt use wifi. either way, im not walking away from my Unlimited Data. its the only thing i have on them.

  • JT3

    I wonder how people would react if Verizon announced that people with “unlimited talk” plans, that are in the top 5% of voice callers by making, say, more than 10 voice calls per day, would suddenly be throttled to no more than 30 seconds per call? It would be a national uproar. However, make it about Internet data, and that’s okay? Interesting.

    The reality is that all of the major carriers screwed up, promising “unlimited” data back when the technology limited us to such slow speeds that it wasn’t an issue. They simply failed to realize how that might play out 2… 3… or even 5 years down the road, and now that speeds are such that someone can actually benefit from an “unlimited” plan, they don’t like it.

    Unfortunately, with the system here in the U.S., where the lobbyists have all the power, and the carriers have enough money to buy a whole lot of lobbyists, our government simply rolls over and lets them get away with whatever they want. It’s sad.

    Having said that, I left Verizon long ago, giving up my unlimited data, because I simply got sick of their business practices. I’m not a heavy user, and my current 10Gb/Mo. on another carrier suits my needs. Still, it isn’t right. Make all the excuses you want about how people are abusing the system, but the reality is that Verizon sold “Unlimited” data as a gimmick, taking advantage of consumers who didn’t know better, and now that technology has turned the tables, they’re suddenly the victims. Defend them all you want, but don’t you dare feel sorry for them. They didn’t feel sorry for their “customers” when the advantage was theirs.

    • yankeesusa

      Man, that voice throttling is a great point. Of course data in itself is a whole other beast but its a great point nonetheless. In the end verizon will most likely loose more customers than keep them if they got rid of unlimited completely. Those customers on unlimited are already paying full price for their phones so it won’t be hard for them to buy a phone and switch over to the att 10gb plan which is a great plan.

    • http://twitter.com/geoff5093 Geoff Johnson

      That is a great point. Today, data is the real cash cow, but what happens in 5 years if for some reason voice calls pick back up in popularity? You can’t think that Verizon would continue to allow unlimited voice calls.

      • Jason Brown

        SERIOUSLY! what are they going to do when they switch to VoLTE?? people w/ tiered data plans are going to be in a real bind.

    • Michael

      Last time I checked all of the wireless carriers where business’ and not charities. They don’t care that you don’t like the way they do business, they care about the bottom line.

      Back when 2g was the best they could do they had tiered data and unlimited, and voice and sms/mms was the cash cow. Now when we’re at a point when we can use different services to make voice calls and send messages, data is the new cash cow. From a business standpoint it makes complete sense to change what brings the CEO a new Yacht and Ferrari every 6 months.

    • Jason Brown

      EXACTLY! you make a great point. if data plans weren’t as much of a “cash cow” as they are today and it was the “talk” plans that brought in the income streams then they would limit that. i remember back in the day when people were trying to save on minutes and not have any overages that they would call sprint and complain about having “dropped calls” to have minutes added to their accounts to increase their monthly voice minutes.

  • Sporttster

    It is about time someone in Government stood up for the consumer! It’s already bs that they can claim unlimited, some of these companies, and throttle service so badly after a few gigs use that it makes it virtually useless and get away with it. Let me clue you in here: saying unlimited but having a 5 gig ‘limit’ before throttling kicks in is not true unlimited. 5gigs and then severe throttling is a LIMIT!

    • Jason Brown

      couldn’t have said it better myself. along the similar lines are the directv dvr’s that you PURCHASE for yourself but then have to pay an additional monthly fee just to use YOUR OWN dvr that your purchase ON TOP of your monthly subscription fee. cant wait until the day arrives where that monthly fee is removed.

  • dizel123

    Yeah, this kinda sucks. I’m pretty sure we know how this is gonna go. FCC gets involved, Verizon says Ok , screw it, we’ll just get rid of unlimited plans altogether.
    Thanks Wheeler.
    BTW, I’m not sure you know what “exclusively” means.

  • http://thatgeekdad.blogspot.com/ Rob Delaney

    The hypocrite is actually on the consumer side here but on the corporation side when it comes to LAN lines? Make up your mind. You can’t be against discrimination of two different plans on the same wireless network but be in favor of discrimination plans when it comes to the same LAN (FiOS, AT&T, Comcast, TWC).

  • Mickey A Valentine

    FCC has a lot on their hands these days. Big fish go’na battle it out.

  • mcdonsco

    Could go many different ways:

    A) Verizon could ignore him (for now)
    B) Verizon could capitulate
    C) Verizon could say “Alright then, nothing says we have to continue offering unlimited data, we’ll just kill the service all together then”

    Knowing Verizon, it will be A or C

    • SilentPatriot

      Ignoring him will get their red little rump in the ringer along with financial and legal sanctions including loss of spectrum. Killing off unlimited data will affect 1/5 of their subscriber base and invite numerous lawsuits. Only way I see for them to save face here is back off.

      • mcdonsco

        What’s stopping them from just saying as of some future date month to month unlimited data accounts will be migrated to a share everything 8gb plan?

        • hkklife

          8GB plan? Unlikely! More like 4 or 6GB. Remember,according to VZW, the “vast majority of unlimited data users only use less than 2GB/month”

          • mcdonsco

            Not that I priced it, I didn’t, but I picked something close to what those users would be paying already (completely forgetting I might pay $120/month (unlimited everything), but likely there are those paying much less for 450 min or something with unlimited too).

            So, my bad…sort of…

          • Cael

            They’ll bump users to 2 GB by default. 29.99 for unlimited = 30.00 for 2 GB

        • trlkly

          The same thing that stopped them from doing that before. The contracts they originally made don’t allow them to do that. To be more specific, that’s the deal they worked out with the FCC when they were sued for violating open network rules by limiting tethering.

          If Verizon could get rid of all unlimited plans, they clearly would. Why try to use a loophole when you could do it directly?

    • Finire

      You forgot the most obvious solution. Verizon could pay him off, just like the lobbyist he used to be.

  • Brooks1

    I use less than 4.7GB a month because I have to. I’m not blessed with unlimited. For those who use 50GB a month….. lay off the internet a bit! :) Are there some legitimate reasons for that much usage on a cellular plan, maybe, but many of you use that much because you can.
    As for Verizon throttling your speeds, well unfortunately your contract with them is up, and they have lived up to the 2 year agreement, you had unlimited data while the agreement was in place. You are now month to month, and they can probably drop you anytime they want (or require you to sigh some sort of agreement).
    I know I’m going to get flamed for expressing this view of the unlimited crowd, but that’s the way it is. If you don’t sign a lease on your apartment, you are month to month, and your landlord can raise the rent whenever he wants, or ask you to move out. This is really no different.
    So be happy that many of you will NOT be throttled, and that you have had this great perk that many of us don’t have for so long,

    • Chris

      Streaming video and music eats up a lot of data. As with Verizon background bloatware services

      • kali bred

        It sure does streaming video services and listening to some play music got me to about 20 or so gigs in about 3 days one month streaming consumes a lot of data hell 3 hours of Hulu alone got me to five gigs

    • M3D1T8R

      I just renewed my contract a few days ago, it now goes until July 2016, and yes that’s on my unlimited line. So how do I fit in to your strange warped view of things? Curious.

    • yankeesusa

      Maybe not 50gb but hitting around 12 to 15gb is easy when you watch netflix on your phone and then when lte is running and your watching videos or just using regular data apps it affects data pretty quick. Not to mention all the bloatware on the verizon phones that also drain data. I no longer have verizon but with my current provider I am already at 11.75gb. That’s only watching netflix once in a while during my lunch break and streaming music throughout the day. So yes, it is easy to go over 15gb